BUSINESS INTELLIGENCE (BI)

BI(Business Intelligence) is a set of processes, architectures, and technologies that convert raw
data into meaningful information that drives profitable business actions. It is a suite of software
and services to transform data into actionable intelligence and knowledge.

BI has a direct impact on organization's strategic, tactical and operational business decisions. BI
supports fact-based decision making using historical data rather than assumptions and gut feeling.

BI tools perform data analysis and create reports, summaries, dashboards, maps, graphs, and charts
to provide users with detailed intelligence about the nature of the business.

Why is BI important?

 Measurement: creating KPI (Key Performance Indicators) based on historic data

 Identify and set benchmarks for varied processes.
 With BI systems organizations can identify market trends and spot business problems that
need to be addressed.
 BI helps on data visualization that enhances the data quality and thereby the quality of
decision making.
 BI systems can be used not just by enterprises but SME (Small and Medium Enterprises)
IMPLEMENTATION OF BUSINESS INTELLIGENCE

Here are the steps:

Step 1) Raw Data from corporate databases is extracted. The data could be spread across multiple
systems heterogeneous systems.

Step 2) The data is cleaned and transformed into the data warehouse. The table can be linked, and
data cubes are formed.

Step 3) Using BI system the user can ask quires, request ad-hoc reports or conduct any other
analysis.

Examples of Business Intelligence System used in Practice

Example 1:
In an Online Transaction Processing (OLTP) system information that could be fed into product
database could be

 add a product line

 change a product price

Correspondingly, in a Business Intelligence system query that would be executed for the product
subject area could be did the addition of new product line or change in product price increase
revenues

In an advertising database of OLTP system query that could be executed

 Changed in advertisement options

 Increase radio budget

Correspondingly, in BI system query that could be executed would be how many new clients added
due to change in radio budget

In OLTP system dealing with customer demographic data bases data that could be fed would be

 increase customer credit limit

 change in customer salary level

Correspondingly in the OLAP system query that could be executed would be can customer profile
changes support support higher product price

Example 2:

A hotel owner uses BI analytical applications to gather statistical information regarding average
occupancy and room rate. It helps to find aggregate revenue generated per room.

It also collects statistics on market share and data from customer surveys from each hotel to decides
its competitive position in various markets.
By analyzing these trends year by year, month by month and day by day helps management to
offer discounts on room rentals.

TYPES OF BUSINESS INTELLIGENCE SYSTEMS

Following given are the four key players who are used Business Intelligence System:

1. The Professional Data Analyst:

The data analyst is a statistician who always needs to drill deep down into data. BI system helps
them to get fresh insights to develop unique business strategies.

2. The IT users:

The IT user also plays a dominant role in maintaining the BI infrastructure.

3. The head of the company:

CEO or CXO can increase the profit of their business by improving operational efficiency in their
business.

4. The Business Users"

Business intelligence users can be found from across the organization. There are mainly two types
of business users

1. Casual business intelligence user

2. The power user.

The difference between both of them is that a power user has the capability of working with
complex data sets, while the casual user need will make him use dashboards to evaluate predefined
sets of data.
ADVANTAGES OF BUSINESS INTELLIGENCE

Here are some of the advantages of using Business Intelligence System:

1. Boost productivity

With a BI program, It is possible for businesses to create reports with a single click thus saves lots
of time and resources. It also allows employees to be more productive on their tasks.

2. To improve visibility

BI also helps to improve the visibility of these processes and make it possible to identify any areas
which need attention.

3. Fix Accountability

BI system assigns accountability in the organization as there must be someone who should own
accountability and ownership for the organization's performance against its set goals.

4. It gives a bird's eye view:

BI system also helps organizations as decision makers get an overall bird's eye view through
typical BI features like dashboards and scorecards.

5. It streamlines business processes:

BI takes out all complexity associated with business processes. It also automates analytics by
offering predictive analysis, computer modeling, benchmarking and other methodologies.

6. It allows for easy analytics.

BI software has democratized its usage, allowing even nontechnical or non-analysts users to collect
and process data quickly. This also allows putting the power of analytics from the hand's many
people.
BI SYSTEM DISADVANTAGES
1. Cost:
Business intelligence can prove costly for small as well as for medium-sized enterprises. The use
of such type of system may be expensive for routine business transactions.
2. Complexity:
Another drawback of BI is its complexity in implementation of data warehouse. It can be so
complex that it can make business techniques rigid to deal with.
3. Limited use
Like all improved technologies, BI was first established keeping in consideration the buying
competence of rich firms. Therefore, BI system is yet not affordable for many small and medium
size companies.
4. Time Consuming Implementation
It takes almost one and half year for data warehousing system to be completely implemented.
Therefore, it is a time-consuming process.

TRENDS IN BUSINESS INTELLIGENCE

Artificial Intelligence: Gartner' report indicates that AI and machine learning now take on
complex tasks done by human intelligence. This capability is being leveraged to come up with
real-time data analysis and dashboard reporting.

Collaborative BI: BI software combined with collaboration tools, including social media, and
other latest technologies enhance the working and sharing by teams for collaborative decision
making.

Embedded BI: Embedded BI allows the integration of BI software or some of its features into
another business application for enhancing and extending it's reporting functionality.

Cloud Analytics: BI applications will be soon offered in the cloud, and more businesses will be
shifting to this technology. As per their predictions within a couple of years, the spending on cloud-
based analytics will grow 4.5 times faster.
Business Process Reengineering

Business process reengineering (also known as business process redesign, business transformation,
or business process change management) is originally pioneered in the early 1990s, focusing on
the analysis and design of workflows and business processes within an organization. BPR involves
discovering how business processes currently operate, how to redesign these processes to eliminate
the wasted or redundant effort and improve efficiency, and how to implement the process changes
to gain competitiveness.

How to Develop As-Is and To-Be Business Process Reengineering?

Business models are developed as defining either the current state of the process, in which case
the final product is called the “as is” snapshot model, or a concept of what the process should
become, resulting in a “to be” model. By studying the difference between the current and target
business state, known as a gap, the business analysts can determine if the existing business
processes and information systems are sound and only need minor modifications, or if
reengineering is required to correct problems or improve efficiency. Consequently, business
process modeling and subsequent analysis can be used to fundamentally reshape the way an
enterprise conducts its operations.
As-is Process
The As-Is process defines the current state of a business process in any given organization or
structure. Generally speaking, the goal of analyzing the current state of a process is to find out
which components could be improved. It is important to bear in mind that this As-Is analysis will
only show you what can be improved, but not necessarily how. Mapping the As-Is process will
only reveal how your business processes are working today.

To-be Process
Typically, a To-Be process is defined as the desired (or target) state of an organizational or
business process. It is the ideal state of how you want your business processes to work, and
mapping the To-Be processes will structurally clarify how you can get there. Thus, you will be
able to see what changes are necessary for your business processes to reach their desired state.

Gap Analysis and Action Plan

A Gap Analysis can help an organization to understand where they want to be, the gap between
where there are now and where they want to be, and hence, what steps (action plan) should be
taken to close the gap.
Thus, to get from our current state to our desired state there will be several key steps we need to
take to bridge the gap. From this, we will create an action plan outlining the exact actions we’ll
take to achieve each step so we eventually close the gap.

Steps for Conducting Gap Analysis

Once you have identified the existing gaps, evaluate how they are keeping you from achieving
your goals. Plan out how you are going to surpass the difficulties. Set clear objectives. This will
enable you to actualize your transition.

Gap Analysis process

Decide the topic you’re going to do the Gap Analysis on? This is the challenge you’re trying to
tackle. There are many topics for gap analysis which include:
Market Share
New Product Features
Revenue
Net Profit

Identify which topic you are right now focused on, for example:
 Market Share – You have 10% of the market share last year
 New Product Features – Your product has was just launched so it has limited features
 Revenue – You’re at $20 million in annual sales last year
 Profit – You’re at $4 million in annual profit last year

Identify where you’d like your business to be improved in a specific time frame (say, one year)?

 Market Share – You would like 15% of the market share

 New Product Features – You would like your product to be able to run in the cloud by next
year
 Revenue – You would like revenue to grow to 30 million in next year
 Profit – You would like profits to grow to 5 million in next year

Identify the gap between where you are and where you want to be. (if the time frame is one year)

 Market Share – The Gap is 5% growth in market share

 New Product Feature – migrate from desktop to cloud technology platform
 Revenue – The gap is 10 Million (from 20 to 30 Million)
  Net Profit – the gap 1 million (from 3 to 4 million)
Determine how the Gap should be filled by considering resource, time and capability:
 Manpower – The people resources you need.
 Methods – The processes you need.
 Metrics – The measurements you need.
 Machines – The automation or technology you need.
 Materials – The material items (such as physical goods or marketing collateral) you need.
 Time – The time you need.

Conduct Business Process Improvement using BPD

The as-is state of a process is the current state. It’s how the process operates before you make any
changes or improvements. The to-be process, on the other hand, is the future state. After an analysis
team builds the AS-IS model using techniques such as Business Process Model and Notation
(BPMN). As-Is BPD diagram describes the present state of the organization’s process, culture, and
capabilities. The To-Be diagram describes the future state; in other words, how the organization’s
process, culture, and capabilities will appear in the future. This studying of the As-is and To-be
process results in identifying the difference between the current and target business state, known
as a gap, which is an important part of any business process reengineering/improvement initiative.
Electronic Commerce
E-Commerce or Electronic Commerce means buying and selling of goods, products, or services
over the internet. E-commerce is also known as electronic commerce or internet commerce. These
services provided online over the internet network. Transaction of money, funds, and data are also
considered as E-commerce. These business transactions can be done in four ways: Business to
Business (B2B), Business to Customer (B2C), Customer to Customer (C2C), Customer to
Business (C2B). The standard definition of E-commerce is a commercial transaction which is
happened over the internet. Online stores like Amazon, Flipkart, Shopify, Myntra, Ebay, Quikr,
Olx are examples of E-commerce websites.

Types of E-Commerce Models

Electronic commerce can be classified into four main categories. The basis for this simple
classification is the parties that are involved in the transactions. So the four basic electronic
commerce models are as follows,

1. Business to Business

This is Business to Business transactions. Here the companies are doing business with each other.
The final consumer is not involved. So the online transactions only involve the manufacturers,
wholesalers, retailers etc.

2. Business to Consumer

Business to Consumer. Here the company will sell their goods and/or services directly to the
consumer. The consumer can browse their websites and look at products, pictures, read reviews.
Then they place their order and the company ships the goods directly to them. Popular examples
are Amazon, Flipkart, Jabong etc.

3. Consumer to Consumer

Consumer to consumer, where the consumers are in direct contact with each other. No company
is involved. It helps people sell their personal goods and assets directly to an interested party.
Usually, goods traded are cars, bikes, electronics etc. OLX, Quikr etc follow this model.
4. Consumer to Business

This is the reverse of B2C, it is a consumer to business. So the consumer provides a good or some
service to the company. Say for example an IT freelancer who demos and sells his software to a
company. This would be a C2B transaction.

APPLICATIONS

1. Online storefronts

Having an online storefront is one of the most straightforward ways to conduct ecommerce. The
merchant creates a website and uses it to sell products and services using shopping carts and
ecommerce solutions. The “right” solution will depend on the merchant and their products. Below
is a list of some of the top ecommerce platforms. Check them out and see which one is right for
you.

Magento – Considered by many as one of the most flexible ecommerce solutions in the market,
Magento offers powerful features right out of the box. It gives merchants the ability to customize
just about aspect of their ecommerce store, and you have complete freedom over the look, feel,
and functionalities of your site.

Magento also has an active community of experts, developers, and agencies allowing merchants
to easily connect with others if they need support. And if you need to further extend the
functionality of Magento, you can always use add-ons to enhance your site.

Demandware – This fully-hosted solution allows you to run a powerful ecommerce store in the
cloud. Merchants using Demandware won’t have to worry much about platform maintenance and
development since it’s fully hosted by the company (though this may limit your freedom a bit).

One of Demandware’s strengths is that it’s built with omnichannel retailers in mind, and it has
features that enable merchants to easily sell across physical and digital storefronts.

Oracle Commerce – This enterprise ecommerce solution can be implemented on-premises, or it

can be hosted by Oracle or a third party. It has features that can benefit both B2B and B2C
merchants, and it comes with powerful functionalities that enable you to sell more complex
merchandise and data-rich offerings.

Oracle Commerce also allows users to easily customize sites and campaigns while giving them the
ability to efficiently launch sites for multiple brands and markets.

Shopify – A popular choice among many SMBs, Shopify has features that let you sell online, on
social media, and in-person. It lets merchants build and customize their ecommerce site through
easy-to-use interfaces and templates. And it has features such as inventory management, reporting,
buy buttons and more. It also has social selling functionalities for those who are active on sites like
Facebook and Pinterest.

Shopify is fully hosted, which means merchants won’t have to worry about maintaining the
platform or using their servers.

WooCommerce – WooCommerce is an open source ecommerce platform for WordPress. It comes

with standard features such as analytics and reporting, shipping options, and mobile-friendly
functionalities. Built specifically for WordPress, WooCommerce seamlessly connects with the
platform. This makes it a very attractive choice for existing WP users.

WooCommerce is highly extendable and very developer-friendly, offering things like custom
AJAX endpoints, Webhook systems, and more.

BigCommerce – Used by big and small brands alike, BigCommerce offers features such as a site
builder, shipping options, reporting, and more. It also enables merchants to sell on other sites and
platforms, including eBay, Amazon, Facebook, Google Shopping, and Square. Plus it has a Buy
Button for enabling sales on blogs, emails, and more.

Additionally, BigCommerce has a built-in B2B offering for wholesalers and merchants selling to
other businesses.

BigCommerce is fully-hosted, so the company handles all platform maintenance and updates.

Volusion – Another popular ecommerce solution, Volusion enables merchants to create online
stores, showcase their merchandise, and take payments all on one platform. Volusion comes with
standard features including a site builder, shopping cart software, marketing tools, and more.
Drupal Commerce – This is an open-source ecommerce framework that enables users to build
online stores and applications on Drupal. Drupal Commerce is highly flexible and offers hundreds
of modules that allow users to enhance and extend its functionalities. There’s also Commerce
Kickstart, “a distribution of Drupal Commerce packed with features that make it more complete,
faster to launch, and easier to administer.”

2. Online marketplaces

Ecommerce transactions can also take place on online marketplaces — sites that facilitate
transactions between merchants and customers. Many online marketplaces don’t own inventory;
rather, they just connect buyers and sellers and give them a platform on which to do business.

Some of the top online marketplaces on the web are:

Amazon – A company that needs no introduction, Amazon is one of the world’s largest online
marketplaces, offering extensive selections of books, electronics, apparel, accessories, baby
products, and more.

As of 2015, there were more than 2 million third-party sellers on the site, and according to Amazon,
these sellers sold 2 billion items in 2014.

eBay – eBay is another popular online marketplace that connects merchants and buyers,
facilitating B2B, B2C, and C2C ecommerce. eBay offers products in several categories, including
electronics, cars, fashion, collectibles, and more.

eBay merchants can also hold auctions that let buyers bid on products. This allows the possibility
of selling items above market value.

Etsy – Etsy is an online marketplace that specializes in handmade, vintage, and one-of-a-kind
goods. Millions of independent sellers use Etsy to showcase and sell their creations, and people
(buyers and sellers alike) love the site because of its community-centric feel.

Alibaba – Alibaba is an online marketplace for wholesalers, manufacturers, suppliers, and

importers/exporters. It’s an effective site that allows users to find vendors and purchase
merchandise in bulk.
Fiverr – This is a “freelance services marketplace” that connects people (mostly entrepreneurs)
with service providers who offer anything from graphic design and online marketing to translation
and video development. As its name indicates, gig pricing on Fiverr starts at $5 USD, though
depending on what you’re selling, that can go up to hundreds, even thousands of dollars.

Upwork – Formerly Elance-oDesk, Upwork is a marketplace that connects individuals and

businesses with freelancers from all over the world. What types of services can you buy and sell
on Upwork? Answer: a whole lot. Freelancers on the site range from web developers and designers
to virtual assistants, accountants, and consultants.

3. Social media

Social media can pave the way for ecommerce in two ways: social sites can facilitate a sale by
directing shoppers to a merchant’s ecommerce site, or they can allow users to buy something
directly on the platform.

In many cases, social networks such as Facebook, Instagram, Twitter, and Pinterest aren’t used
as ecommerce platforms. Rather, merchants use these sites to showcase their merchandise. And
when shoppers come across an item that they like on social, they are directed to the merchant’s
ecommerce site.

For instance, many retailers who show off their products on Instagram use solutions such
as Like2Buy to enable customers to purchase the items. Here’s how it works: when a user sees a
product that they like on their Instagram feed, they can click the merchant’s Like2Buy link so they
can view the item’s product page.
 M-Commerce
Mobile commerce popularly known as m-commerce is actually just a subset of e-commerce. The
term itself was coined in 1997 by Kevin Duffy. It is essentially a way of carrying thousands and
millions of retail shops in your pocket. Let us study a bit more about mobile commerce.

Very simply put M-commerce entails the e-commerce transactions done with a mobile phone. So
M-commerce is the use of mobile phones to conduct any type of business transaction. It takes the
help of the e-commerce background and WAP technology.

The use of wireless technology (WAP) to conduct sales of goods, provide services, make payments
and other financial transactions, the exchange of information etc. is the basis of mobile commerce.

M-commerce is actually a rapidly growing sector of e-commerce. Nearly 70% of the online
transactions that occur in India happen from mobile phones. Globally it is a 700 billion
dollar industry.

Applications of M-commerce

Other than the straightforward m-commerce transactions of buying and selling of goods and
services, they have so many applications. Let us take a look at a few examples,

 Mobile Banking: Using a mobile website or application to perform all your banking
functions. It is one step ahead of online banking and has become commonplace these days.
For example, in Nigeria, the majority of banking transactions happen on mobile phones.
 Mobile Ticketing and Booking: Making bookings and receiving your tickets on the
mobile. The digital ticket or boarding pass is sent directly to your phone after you make
the payment from it. Even in India now IRTC and other services provide m-ticketing
services.
 E-bills: This includes mobile vouchers, mobile coupons to be redeemed and even loyalty
points or cards system.
 Auctions: Online auctions having now been developed to be made available via mobile
phones as well.
 Stock Market Reports and even stock market trading over mobile applications.
 Advantages of M-commerce

 It provides a very convenient and easy to use the system to conduct business transactions.
 Mobile commerce has a very wide reach. A huge part of the world’s population has a
mobile phone in their pocket. So the sheer size of the market is tremendous.
 M-commerce also helps businesses target customers according to their location, service
provider, the type of device they use and various other criteria. This can be a good
marketing tool.
 The costs of the company also reduced. This is due to the streamlined processes, now
transaction cost, low carrying cost and low order processing cost as well.


Disadvantages of M-commerce

 The existing technology to set up an m-commerce business is very expensive. It has great
start-up costs and many complications arise.
 In developing countries, the networks and service providers are not reliable. It is not most
suitable for data transfer.
 Then there is the issue of security. There are many concerns about the safety of the
customer’s private information. And the possibility of a data leak is very daunting.
 E-Governance
E-Governance can be defined as the application of communication and information technology for
providing government services, exchange of information, transactions, integration of previously
existing services and information portals.

It makes the whole administrative process convenient, efficient, transparent, fully accountable and
responsible. As a fast-growing economy and an emerging world leader, E-Governance is a must
in a country like India, both in Government and corporate sector.

Some effective examples of successful implementation of E-Governance to the governmental

function include projects like; e-Mitra project(Rajasthan), e-Seva project(Andhra Pradesh),
CET(Common Entrance Test)

Advantages of E-Governance

 Speed
Technology makes communication swifter. Internet, smartphones have enables instant
transmission of high volumes of data all over the world.
 Saving Costs
A lot the Government expenditure goes towards the cost of buying stationery for official
purposes. Letters and written records consume a lot of stationery. However, replacing them
with smartphones and the internet can saves cores of money in expenses every year.
 Transparency
The use of e-governance helps make all functions of the business transparent. All
Governmental information can be uploaded onto the internet. The citizens access
specifically access whichever information they want, whenever they want it, at the click of
a mouse, or the touch of a finger. However, for this to work the Government has to ensure
that all data as to be made public and uploaded to the Government information forums on
the internet.
  Accountability
Transparency directly links to accountability. Once the functions of the government are
available, we can hold them accountable for their actions.

Disadvantages of E-Governance

 Loss of Interpersonal Communication

The main disadvantage of e-governance is the loss of interpersonal communication. Interpersonal

communication is an aspect of communication that many people consider vital.

 High Setup Cost and Technical Difficulties

Technology has its disadvantages as well. Specifically, the setup cost is very high and the machines
have to be regularly maintained. Often, computers and internet can also break down and put a dent
in governmental work and services.

 Illiteracy

A large number of people in India are illiterate and do not know how to operate computers and
smartphones. E-governance is very difficult for them to access and understand.

 Cybercrime/Leakage of Personal Information

There is always the risk of private data of citizens stored in government serves being stolen.
Cybercrime is a serious issue, a breach of data can make the public lose confidence in the
Government’s ability to govern the people.
 Roles of Business intelligence for the E-commerce industry

There is some E-commerce specific Business Intelligence required to efficiently run an E-

commerce business. However, most of the matrices are the same as those required by all
businesses. Some of the important reports related to E-commerce business are

 Top Performers in the Market: Business Intelligence analyzes the Most profitable
advertising campaigns, customers, segments and products based on data and gives the E-
commerce business a clear view of how they should do their marketing.
 Trend Analysis: Business Intelligence analyses the trends of changing customer
preferences and behavior to shape the E-commerce business.
 Margin Analysis: Business Intelligence analyzes the Cost and profit. Business Intelligence
list products and product lines, Areas where margins can be increased, price sensitivity and
elasticity of demand.
 Live Marketing Reports: Business Intelligence analyzes the Products included in the cart,
abandoned carts, search terms used, the response of the newsletter, etc. And gives live
marketing report.
 Live Sales Report: Sales Analysis, sales, returns, taxes, shipping, refunds, discount
coupons, promotional offerings, and credit card collection into formations can get live with
Business Intelligence.
 Inventory Reports: Items sold, available quantities, items to be reordered, new items,
orders in hand and on order, inventory in transit and much more are analyzed by business
intelligence for better inventory management.